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Online advertising 'overtakes TV'

30 September 09 11:05 GMT

Online advertising spending in the UK has overtaken television expenditure for the first time, a report has said.

Online spending grew 4.6% to £1.752bn in the first half of 2009, while TV spending shrank 16.1% to £1.639bn.

Overall advertising fell 16% compared with the same period in 2008, said the study by the Internet Advertising Bureau and PricewaterhouseCoopers.

E-mail campaigns, classified adverts, display ads and search marketing are all classed as online advertising.

The body representing UK commercial television broadcasters said that the comparison was unfair.

'Huge milestone'

The recession had accelerated the migration of advertising spending to digital technology - from more traditional media such as print, radio and television advertising to online, according to the report.

Justin Pearse, editor of industry website New Media Age, said the tough economic times had led to a significant fall in TV advertising spending, which saw it being overtaken about a year earlier than most had expected.

"It had to happen eventually, but online advertising has been seen as the poor cousin to TV for so long that it's still a huge milestone."

Technology firms were the biggest spenders on online adverts, making up about 19% of the market, the report said, followed by telecoms firms, the finance sector and entertainment and media.

Online display advertising - such as banners - had "performed notably well against its peers in TV, print and radio", said Guy Phillipson, chief executive of the Internet Advertising Bureau.

"We have a rollercoaster of a year ahead, but even in tough economic conditions, marketers still recognise the value, accountability and measurability of online advertising."

'Complementary relationship'

However, Thinkbox, the marketing body for the main UK commercial television broadcasters, said the figures did not compare like with like.

"Online marketing spend is made up of many things including e-mail, classified ads, display ads and, overwhelmingly, search marketing. They should be judged individually," said Lindsey Clay, Thinkbox's marketing director.

"The internet is a fantastic technology and home to many different marketing activities that do different things. As such, it is interesting but meaningless to sweep all the money spent on every aspect of online marketing into one big figure and celebrate it.

Television advertising remained the most effective advertising medium "pound for pound" but was even more effective when put together, Ms Clay added.

"To set them up in competition is a mistake and misses their complementary relationship."

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